Paint and Coatings manufacturer reports 10% sales drop but mitigates UK decline with price increases.
Sales in Akzo Nobel's decorative paints business, which includes the Dulux, Sadolin and Metalmaster brands dropped 6% in Q3, with sales volume in the category declining 9%. The company managed to increase its EBITDA margin in decorative paints to 15.2%, compared with 15% in 2008 and mitigated the revenue decline in Europe with price increases and margin management.

The Dutch company reported that retail volume was up year on year in the UK but that it had experienced a "modest decline" in the trade side of the business.

Akzo also experienced costs related to major restructuring projects in its European decorative paints business, which included six site closures. In the US, Akzo closed 48 out of 412 stores, reacting to what it describes as a "depressed" market. The company also announced that it is on track for a 20% reduction in the workforce at its head office and shared service centre in the Netherlands.

Akzo Nobel ceo Hans Wijers commented on the results: "We have seen some signs of an improvement in emerging markets, but overall we don't forsee a quick recovery. The business environment continues to be tough... We remain committed to implementing our restructuring and integration programs and we are on track to deliver o our previously stated EBITDA margin target of 14% by the end of 2011."